GM, Koenigsegg Finalize Saab Deal

18 August, 2009 06:29:00

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General Motors has reached a 100% stock purchase agreement to transfer its loss-making Swedish unit Saab Automobile AB to a group led by Swedish luxury supercar producer Koenigsegg Automobile AB.

The move comes two months after the two car makers signed a memorandum of understanding in which GM agreed to invest more into Saab after its spin-off than it would receive from the buyers.

The deal is expected to conclude in the next months and will then secure Saab’s future. Saab Automobile plans to exit legal reorganization shortly.

The stock purchase agreement will be subject to agreed closing conditions. Conditions to close the sale include expected funding commitments with Swedish government support and guarantees, as well as transitional assistance from GM, as Saab becomes independent. Saab is about to launch several new cars, developed with General Motors that are in the final stages of development.

The European Investment Bank is expected to make a decision at its board meeting Sep. 22 on whether to approve about $610 million in loans to Saab.

As part of the proposed transaction, GM and Saab will continue to share technology and services during a defined time period. This will be managed through licenses and service agreements.

GM has owned Saab for 19 years and has never made a profit from its Swedish unit.

The Koenigsegg Group is a consortium led by the Swedish luxury car maker Koenigsegg Automotive AB, Norwegian investor Baard Eker and Augie K. Fabela II, co-founder and former chairman of Russian telecom operator VimpelCom.

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